Quiz Set 2 with answers.pdf - AA102 Accounting II Semester...

AA102 Accounting II Semester 1, 2008-09
Mid-Semester Quiz: Session 2
Instructions:
▪ Please follow the instructions given by the Invigilators.
▪ This quiz paper contains 20 questions and comprises 6 pages.
▪ Answer all questions. For each question, you are required to select the best
available answer and shade its representing alphabet on the answer sheet provided.
▪ Each correct answer will be awarded 1 mark.
▪ Time allowed: 1 hour
_________________________________________________________
1. Which of the following is false about direct costs?
A. Direct cost includes variable cost only.
B. Direct cost includes fixed cost only.
C. Direct cost includes production cost only.
D. Direct cost includes non-production costs only.
E. all of the above.*
2. If the volume of production increases, the cost per unit would be expected to
3. Newton Company recently had a fire in its accounting office, destroying most of
its records. Only the following information could be salvaged for 20x8:
Direct labor $ 400,000
Factory overhead $ 200,000
Cost of goods sold $ 800,000
Work in process, January 1 $ 80,000
Finished goods, January 1 $ 160,000
Work in process, December 31 $ 100,000
Finished goods, December 31 $ 120,000
The cost of direct materials used in production during 20x8 is
Session 2 Page 1 of 6

4. Which of the following would not be classified as a product cost?
5. Which is the correct entry to account for manufacturing overhead under normal
costing system?
A. Debit WIP inventory account with actual manufacturing overhead.
B. Debit manufacturing overhead account with applied manufacturing
overhead.
C. Credit manufacturing overhead account with actual manufacturing overhead.
D. Debit WIP inventory account with applied manufacturing overhead.*
E. Credit WIP inventory account with actual manufacturing overhead.
Session 2 Page 2 of 6